PPI: More data needed on ethnic groups’ retirement outcomes

In a briefing note published on August 18, the PPI argued: “While there is some overarching data across ethnic groups as a whole in national surveys, sample sizes are typically inadequate to allow understanding of the many different factors that affect the outcomes of particular ethnic groups. 

“With better data and evidence about the lives of people in these groups, informed, strategic policymaking which improves their lives will be possible in a way that it is not today.”

The note explained that available data highlights that people from certain minority groups are more likely to be unemployed, self-employed or in part-time work, though further breakdowns along the lines of age and gender are not possible with the existing data sets.

It also highlighted the difficulties in breaking down the performance of individual ethnic groups because of the way they are lumped together in official statistics, with black African/Caribbean and black British groups being bundled into a single category, while Roma, gypsy and travellers are classed as “white”.

Unemployment and part-time work in particular are associated with inadequate — and in some cases non-existent — pension savings, meaning ethnic groups that are disproportionately focused in alternative or non-working categories will, on average, see less-adequate retirement standards.

The briefing note also highlighted Office for National Statistics data suggesting that people from certain minority groups suffer a “pay gap”, meaning they earn, on average, less than other minority groups, and less than the average among white people.

However, the data also revealed that significant differences exist between different subsets of individual ethnic categories, with the pay gap for those from white and black African backgrounds “higher than for those from white and black Caribbean backgrounds”, and “there are further variations between people from other black backgrounds”. 

“If variations by gender were also included, further breakdowns and enhanced understanding of lived experiences would be possible,” the note explained.

Groups that are not “sufficiently disaggregated”, and for whom sample sizes are too small, are hard to properly account for, meaning policy responses cannot be properly targeted, the PPI argued.

It suggested a variety of areas where more detailed data would be helpful, such as “the impact of generational poverty and disadvantage”, the impact of “cultural, religious and family expectations”, attitudes to caring and how retirement should be supported, further data on household financial decision-making, and on how all these factors “differ between generations, age groups, and whether people are first, second, third‐generation immigrants”.

Daniela Silcock, head of policy research at the PPI, said: “Data gathering on people from ethnic minority groups is inadequate, especially in light of the poor average pension outcomes experienced by black African/Caribbean, Pakistani, Bangladeshi and Chinese people. 

“These problems will affect more people in future as the proportion of ethnic minorities in the UK is expected to grow from around 15 per cent today to around 30 per cent by 2061.” 

Silcock said that “strategic, tailored policymaking and action by involved organisations (such as pension schemes), is required to reduce ethnic inequalities in retirement”, but reiterated that there is “insufficient data available” on the experiences of minority groups “to effectively inform policy and effect change”.

“If retirement outcomes are to be made more equal, it is critical that there is better evidence on the impact of discrimination, intergenerational disadvantage, and the way that culture and religion shape the experiences and opportunities of people from ethnic minority groups,” she said.